The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
FEDERAL RESERVE BANK O F DALLAS 1961 To the Member Banks in the Eleventh Federal Reserve District: The Statement of C ondition and the Earnings and Expenses of the Federal Reserve Bank of Dallas for the year 1961, with comparative figures for 1960, are shown herein. A review of economic and financial developments in the Nation and the District during 1961 is being presented in the January 1962 Annual Report Issue of the Business Review of this Bank. Additional copies of these publications may be obtained upon request to the Research Department, Federal Reserve Bank of Dallas, 400 South Akard Street, Dallas 2, Texas. Sincerely yours, W atrous H . I rons President This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) <.S tatem en t o} Condition Dec. 31, 1960 Dec. 31, 1961 A SSETS Gold certificate a c c o u n t.................................................. $ Redemption fund fo r Federal Reserve notes . . Total gold certificate re serve s......................... Federal Reserve notes of other B a n k s ......................... Other c a s h ........................................................................... Discounts and advances.................................................. U. S. Government securities B i l l s ................................................................................. C e rtific a te s ..................................................................... N o te s................................................................................. B ond s................................................................................. 5 8 7 ,2 5 5 ,4 7 6 .1 5 3 5 ,4 6 5 ,0 7 1 .1 7 $ 7 3 1 ,3 9 4 ,9 6 3 .8 0 3 2 ,6 9 3 ,1 3 6 .1 7 6 2 2 ,7 2 0 ,5 4 7 .3 2 2 9 ,5 5 2 ,1 0 0 .0 0 14,9 52 ,12 0.8 8 8 70 ,00 0.0 0 7 6 4 ,0 8 8 ,0 9 9 .9 7 2 4 .6 4 6 .6 0 0 .0 0 15.265.157.01 8 14 ,00 0.0 0 1 2 9 ,6 9 4,0 00 .00 6 9 ,0 2 8 ,0 0 0 .0 0 8 1 1 ,6 8 4 ,0 0 0 .0 0 1 5 6 ,20 2,0 00 .00 1 1 6 .8 7 7 .0 0 0 . 00 3 6 5 .1 0 8 .0 0 0 . 00 5 0 2 .9 9 6 .0 0 0 . 00 1 0 2 .4 8 6 .0 0 0 . 00 1 ,1 6 6 ,6 0 8 ,0 0 0 .0 0 1 ,0 8 7 ,4 6 7 ,0 0 0 .0 0 Total loans ands e c u ritie s ................................. 1 ,1 6 7 ,4 78 ,00 0.0 0 Due from foreign b a n k s .................................................. Cash items in process of collection................................ 2 9 6 ,0 8 4 ,0 8 7 .0 2 Bank p rem ise s.................................................................... 1 3,2 72 ,51 2.4 6 9,899,097.91 Other a s s e t s ..................................................................... 1 ,0 8 8 ,2 8 1 ,0 0 0 .0 0 825.03 2 5 9 ,4 6 7 ,9 5 8 .2 6 1 3 ,9 00 ,43 1.9 9 8 ,6 2 0 ,4 3 2 .6 4 Total U. S. Government securities . . . . TO TA L A S S E T S .................................................. 2 ,1 5 3 ,9 5 8 ,4 6 5 .5 9 2 ,1 7 4 ,2 7 0 ,5 0 4 .9 0 Federal Reserve notes in actual circulation . . Deposits Member bank — reserve a c c o u n ts......................... U. S. Treasurer — general account......................... F o r e ig n ........................................................................... O th e r................................................................................. 8 6 9 ,1 0 5 ,3 2 0 .0 0 8 3 5 ,9 7 2 ,9 0 0 .0 0 9 3 1 ,9 4 9 ,0 0 7 .1 6 2 3 ,5 0 8 ,6 7 4 .1 7 1 5,3 70 ,00 0.0 0 3 ,3 8 2 ,8 9 1 .0 7 9 7 1 ,0 8 3 ,2 9 2 .5 6 53,390,099.41 12,4 12 ,00 0.0 0 3 ,4 2 3 ,1 0 7 .9 4 Total d ep osits........................................................ Deferred availability cash ite m s..................................... Other lia b ilitie s.................................................................... 9 7 4 ,2 1 0 ,5 7 2 .4 0 2 3 3 ,6 8 0 ,4 7 8 .7 2 2 ,2 4 8 ,7 4 4 .4 7 1 ,040,308,499.91 2 2 6 ,4 5 0 ,0 5 2 .5 4 1 ,0 2 7,3 52 .45 TO TA L L I A B I L I T I E S ............................................ 2 ,0 7 9 ,2 4 5 ,1 1 5 .5 9 2 ,1 0 3 ,7 5 8 ,8 0 4 .9 0 Capital paid i n .................................................................... S u r p lu s ................................................................................. 2 4 ,9 0 4 ,4 5 0 .0 0 4 9 ,8 0 8 ,9 0 0 .0 0 2 3 .5 0 3 .9 0 0 .0 0 4 7 .0 0 7 .8 0 0 .0 0 TO TA L CAPITAL A C C O U N T S ......................... 7 4 ,7 1 3 ,3 5 0 .0 0 7 0 ,5 1 1 ,7 0 0 .0 0 TO TA L LIABILITIES AND CAPITAL ACCOUNTS $ 2 ,1 5 3 ,9 5 8 ,4 6 5 .5 9 $ 2 ,1 7 4 ,2 7 0 ,5 0 4 .9 0 LIABILITIES CAPITAL ACCOUNTS I n c l u d e d in “ O t h e r a s s e t s . " ^ a rn in g d and E xpen ded 1961 I9 6 0 CURRENT EARNINGS Discounts and advances.................................................. 6 2,7 5 8 .3 4 $ 1 ,2 1 0,5 94 .35 U. S. Government securities............................................ $ 3 7 ,9 5 0 ,2 0 7 .5 0 4 3 ,4 6 6 ,8 5 3 .3 7 All o t h e r ........................................................................... 19,095.85 5 5 ,3 7 2 .1 5 TO TA L CURRENT E A R N IN G S ......................... 3 8 ,0 3 2 ,0 6 1 .6 9 4 4 ,7 3 2 ,8 1 9 .8 7 8 .5 3 0 .9 6 8 .7 9 8 .0 4 1.5 79 .73 3 5 9 .2 0 0 .0 0 3 7 6 .5 0 0 .0 0 3 8 0 .1 7 2 .0 0 2 91 .47 9.0 0 Cost of redemption, including shipping charges . 3 2 ,5 9 5 .0 0 3 1 ,0 2 5 .0 0 T o t a l .................................................................... 9 .3 0 2 .9 3 5 .7 9 8 .7 4 0.5 83 .73 Less reimbursement fo r certain fiscal agency and other e x p e n se s..................................... 9 3 5 .0 8 3 .0 0 9 6 0 .0 3 6 .0 0 N ET E X P E N S E S .................................................. 8 .3 6 7 .8 5 2 .7 9 7 .7 8 0 .5 4 7 .7 3 2 9 ,6 6 4 ,2 0 8 .9 0 3 6 ,9 5 2 ,2 7 2 .1 4 140,481.81 9 7,5 23 .33 C URRENT EXPENSES Current operating expenses............................................ Assessment fo r expenses of Board of Governors . Federal Reserve currency Original cost, including shipping charges . PRO FIT AND LO SS Current net e a rn in g s........................................................ Additions to current net earnings Profit on sales of U. S. Government securities (net) Transferred from reserves fo r contingencies 5 1 3 ,7 0 4 .7 2 . All o th e r.......................................................................... 94.43 686.83 Total a d d itio n s .................................................. 140 ,57 6.2 4 6 11 ,91 4.8 8 Deductions from current net e a rn in g s......................... 1.978.80 1.713.83 Total deductions.................................................. 1.978.80 1.713.83 Net a d d itio n s .................................................................... Net earnings before payments to U. S. Treasury . Dividends p a i d .............................................................. Paid U. S. Treasury (interest on F. R. notes) Transferred to s u r p l u s .................................................. 138 ,59 7.4 4 6 1 0 ,2 0 1 .0 5 2 9 ,8 0 2 ,8 0 6 .3 4 3 7 ,5 6 2 ,4 7 3 .1 9 1,454,690.31 1,3 8 0,6 53 .36 2 5 ,5 4 7 ,0 1 6 .0 3 3 3 ,8 1 8 ,9 1 9 .8 3 2 ,8 0 1 ,1 0 0 .0 0 2 ,3 6 2 ,9 0 0 .0 0 <2 )ire c to r^ FEDERAL RESERVE BANK OF DALLAS R o bert O. A nderson (C hairm an and F ederal R eserve A g en t), President, Hondo Oil & Gas Company, Roswell, New Mexico L amar F l e m in g , J r . (D e p u ty C hairm an), Member, Board of Directors, Anderson, Clayton and Company, Inc., Houston, Texas MORGAN J. D avis , Chairman of the Board, Humble Oil & Refining Company, Houston, Texas JOHN M . G r if f it h , President, The City National Bank of Taylor, Taylor, Texas D . A. HULCY, Chairman of the Board, Lone Star Gas Company, Dallas, Texas J. EDD M c L au GHLIN, President, Security State Bank & Trust Company, Ralls, Texas J. B. PERRY, J r ,, President and General Manager, Perry Brothers, Inc., Lufkin, Texas ROY RIDDEL, President, First National Bank at Lubbock, Lubbock, Texas H . B. ZACHRY, President and Chairman of the Board, H. B. Zachry Company, San Antonio, Texas EL PASO BRANCH F lo \D CHILDRESS, Vice President, The First National Bank of Roswell, Roswell, New Mexico ROGER B. C o r b e t t , President, New Mexico State University, University Park, New Mexico DYSART E. HOLCOMB, Director of Research, El Paso Natural Gas Products Company, El Paso, Texas JOSEPH F . I rv in , President, Southwest National Bank of El Paso, El Paso, Texas WILLIAM R, M a th ew s , Editor and Publisher, “The Arizona Daily Star," Tucson, Arizona CHARLES B. P erry , President, First State Bank, Odessa, Texas DlCK R ogers , President, First National Bank in Alpine, Alpine, Texas HOUSTON BRANCH A . E. CUDLIPP, Vice President and Director, Lufkin Foundry & Machine Company, Lufkin, Texas J. A . ELKINS, J r ., President, First City National Bank of Houston, Houston, Texas M. M . GALLOWAY, President, First Capitol Bank, West Columbia, Texas JOHN E. G ray , President, First Security National Bank of Beaumont, Beaumont, Texas EDGAR H . H u dg in s , Co-owner in J. D. Hudgins Partnership (Ranching), Hungerford, Texas M ax LEVINE, President, Foley’s, Houston, Texas J. W . McLEAN, President, Texas National Bank of Houston, Houston, Texas SAN ANTONIO BRANCH G . C . HAGELSTEIN, President and General Manager, Union Stock Yards San Antonio, San Antonio, Texas HAROLD D. H ern d o n , Independent Oil Operator, San Antonio, Texas D onald D. J a m es , Vice President, The Austin National Bank, Austin, Texas M ax A . M an DEL, President, The Laredo National Bank, Laredo, Texas F o rrest M . S m it h , President, National Bank of Commerce of San Antonio, San Antonio, Texas J o h n R . S t o c k to n , Professor of Business Statistics and Director of Bureau of Business Research, The University of Texas, Austin, Texas D w ig h t D . T aylor , President, Pan American State Bank, Brownsville, Texas FEDERAL ADVISORY COUNCIL MEMBER I. F . B E T T S , P re s id e n t, T h e A m e ric a n N a tio n a l B a n k o f B e a u m o n t, B e a u m o n t, T ex as 0}}icer<i FEDERAL RESERVE BANK OF DALLAS W atrous H. I r o n s , President H arry A. S h u fo rd . First Vice President H oward C a rrith ers , Vice President W . M . P r it c h e t t , Vice President J a m es L. C a u t h e n , Vice President A r th u r H . L ang , General Auditor P. E. C o l d w e l l , Vice President J. L. C ook , Vice President T. A. H ardin , Vice President C arl H. M o o r e , Vice President G. R. M u r f f , Vice President and Secretary o f the Board J a m es A . P arker , Vice President T. W. P la n t , Vice President and Cashier L. G. P o n d r o m , Vice President G eorge F . R udy , General Counsel R o bert H . B o y k in , Assistant Counsel and Assistant Secretary of the Board T hom as R. S u lliv a n , Assistant Vice President E. H . B erg , Assistant Cashier R oy E . B o h n e , Assistant Cashier ♦ F redric W . R eed , Acting Assistant Cashier E . A . T hax to n , J r ., Assistant Cashier J a m es O. R u s s e l l , Chief Examiner EL PASO BRANCH H oward C a rrithers , Vice President in Charge * F redric W . R eed , Cashier T . C. A rn o ld , Assistant Cashier HOUSTON BRANCH J. L. C ook , Vice President in Charge B. J. T roy , Cashier W. C. H artung , Assistant Cashier R asco R. Sto ry , Assistant Cashier SAN ANTONIO BRANCH C arl H . M o o r e , Vice President in Charge A . E. M u n d t , Cashier A lv in E . R u s s e l l , Assistant Cashier * Temporarily assigned to the Dallas office. F red erick J. S c h m id , Assistant Cashier B U S IN E S S R E V IE W JANUARY 1962 Vol. 47, No. 1 ANNUAL REPORT ISSUE ECONOMIC RESURGENCE IN 1961 The broad pattern of economic and financial developments in the United States during 1961 reflected a picture of growing strength in virtually all sectors of the economy. Among the high lights of the year were the recovery from the short recession of late 1960 and early 1961, the shifting emphasis brought by a new political administration in both defense expenditures and the underlying philosophy of the Federal Government’s role in the American economy, and the influence exerted upon the monetary and fiscal policies of the Nation by the concern over this Nation’s balance of payments and international financial relationships. To these must be added the entire Nation’s con tinuing concern over unemployment — its level, composition, and rate and the prospects for improvement of the situation. A corollary matter under continuous discussion among Government policy makers and professional private observers was the rate of economic growth needed for material improvement of the domestic unemployment problem and to enable the United States to maintain its position as a leader of the free world whose currency could command the respect and confidence of other nations. FEDERAL RESERVE DALLAS, BANK TEXAS OF DALLAS There were a number of significant offshoots from these primary features of the year, including the re markable stability of interest rates and price levels, the substantial uptrend in consumer, business, and bank liquidity, and the surprising ease with which the Nation’s increasing budget deficit was financed without severe strains in the securities market. The entire eco nomic scene for 1961 reflected a year of growth and development in this Nation comparable to any re covery period in previous cycles. The mild nature of the recent recession can be seen in the relatively small decline of only $6 billion, or approximately 1 percent, in gross national product from the peak in the second quarter of 1960 to the trough in the first quarter of 1961. In contrast, the recovery was quite vigorous, with gross national product increasing about $42 billion from the cyclical trough in the first quarter to the end of the year and averaging $521 billion for the year, or 3 percent over 1960. More than half of the gain occurred in personal consumption; gross private domestic investment ac counted for about 40 percent, and the remainder came from government spending. The large increase in personal consumption may be a surprise to some observers, since there were a substantial number of comments during the year that consumers were not increasing their rate of spending in proportion to their ability to spend. However, this reluctance was clearly dispelled in the fourth quarter by a sharp gain in retail trade, especially in automobile sales. On the other hand, some observers may be surprised by the relatively small increase in govern ment spending, which had been advertised as the major cause of the improvement in the economy during the first and second quarters. In other words, a careful inspection of the internal components and principal indicators of the economy is required to give perspec tive to the recovery that brought the economy to new records in virtually all major sectors. The restudy requires special emphasis upon timing and some ref erences to the usual leads and lags during business cycles. Economic Developments In reviewing the changes in the Nation’s economy over the past 12 months, one is impressed by the speed and force of the recovery. By hindsight, it is possible to see that, despite the atmosphere of considerable gloom attending the new year’s entrance, corrective forces were already under way which would, in only a short BUSINESS 2 REVIEW 1:1962 REC ESSIO N IN SELEC TED ECO NOM IC IN D IC A TO R S United States Indicator First quarter 1961 Second quarter 1960 Industrial production index |1 9 5 7 = 1 0 0 )1................................. Charge in business inventories2.................................................... Expenditures for new plant and equipment2......................... Total new construction expenditures2......................................... Manufacturers' new durahle goods orders2........................... Unemployment rate (percent of civilian labor force]1. . . . Personal income2................................................................................ Retail sales2.......................................................................................... 102.3 — 4.0 33.85 55.8 13.4 6.8 404.7 17.9 109.3 5,4 36.30 54.9 14.5 5.2 404.2 18.6 1 Seasonally adjusted. - Seasonally adjusted, in billions of dollars. S O UR C ES : Board of Governors of the Federal Reserve System. United States Department of Commerce. United Stales Department af Labor. period of time, reverse the economic downtrend. Many of these forces had been developing in the last half of 1960. Among the most im portant were the corrective actions of business, including inventory liquidation, the layoff of workers to balance employ ment with production levels, and the reduction of capital expenditures. These policies were the cause of many of the declines in major indicators during the fourth quarter of 1960 and the first quarter of 1961, but they were also the principal factors which even tually corrected the imbalances that had developed in the economy. As unused capacity increased, plant and equipment expenditures were reduced in the latter part of 1960, with the usual ramifying effect upon capital goods, manufactures, construction, and em ployment. Also of considerable importance was the emphasis upon active ease, toward which monetary policies were directed. Thus, by early 1961, though the total pattern of eco nomic indicators reflected further declines, the economy actually had reached a cyclical trough and started to improve. During the first quarter, additional downward pressures were being exerted by heavier inventory liquidation, declines in private capital spending, and a marked reduction in consumer spending for durable goods. Moreover, construction activities were weaken ing in virtually all major segments. As a result, durable goods manufacturers’ orders declined steadily until January but then began a marked resurgence which carried forward throughout the year. To some extent, the declining forces were reinforced by the reduction in employment, as well as by a rather low level in the factory workweek. Offsetting these downward pres sures during the first quarter were a rise in government spending and an increase in exports. By early March, random signs of recovery appeared in an improvement in manufacturers’ new orders, a cessation of inventory liquidation, and the resulting REC O VERY IN SELEC TED ECO NOM IC IN D IC A TO R S United States Indicator July 1961 February 1961 ......................... Industrial production index (1 9 5 7 = 100)1 Total new construction expenditures2......................................... Manufacturers' new durable goods orders2. , ............. Personal income2............................ ................................................... Retail sales2............... .......................... .............................................. 112,0 57.0 15.0 421.2 18.0 102.1 55.7 13.4 403.1 17.8 1 Seasonally adjusted. Seasonally adjusted, in billions of dollars. S OU RC ES : Board of Governors of the Federal Reserve System. United States Department af Commerce. United States Department of Lahor. increase in industrial production. As the second quarter progressed, the forces of recovery gained strength and outweighed the continued downward pressures to such an extent that the general economy began to show major signs of improvement. This im provement continued throughout the second and third quarters of the year, although the rate of gain was slowed in the latter part of the third quarter, partly because of temporary factors. With industrial production advancing quickly from April to July, the atmosphere of recession quickly abated. Although unemployment remained uncom fortably high, personal incomes rose quickly; and Gov ernment fiscal policies, which had been shifted to accommodate some countercyclical measures, were further changed to allow for enlarged spending for defense purposes. Government demands for goods and services rose quickly and added to the improved pri vate demand as business orders and sales continued steadily upward. Even the level of construction activ ities began to improve, although the gain was fairly slow and was concentrated in residential building. One of the main impediments to rapid economic recovery continued to be the downtrend in private capital spend ing, although this was reversed in the third quarter. Meanwhile, special Government programs were in augurated to stimulate certain types of construction. Among these programs were the early releases of funds for highway construction, a new housing bill to foster both public and private home building, and reductions in terms for FHA mortgage loans. The effects of these growing supports to the economy upon industrial production were quickly apparent. From February (the cyclical trough) to July, total factory output advanced nearly 10 percent; the principal improvement occurred in durable goods, the manufacturing sector which had shown the most noticeable decline in the previous year. Durable goods output increased 13 percent from February through July, while nondurable goods production rose about 8 percent. The improvement in the mining sector was negligible. From July to October, the rate of economic advance slowed markedly. Part of the reason for this slowdown could be traced to an early model change-over in the automobile industry, the usual summer lull in primary metals and similar industries, and some shifts in the business outlook as observers bega i to question the permanency of the upturn without a supporting rise in personal consumption expenditures. Reinforcing this attitude was the evidence of rapidly accumulating in ventories, especially in the durable goods field. At the close of the summer, the threat of a major automobile strike had begun to slow manufacturers’ orders; in fact, durable goods orders were almost unchanged between August and September. When the automobile strike did occur, though only on a company-by-company basis, its effect emphasized the summer slowdown. Moreover, Government expenditures, which had been climbing at an annual rate of more than $2 billion, suddenly slowed. The third quarter also contained some severe weather disturbances, which interrupted industrial production in primary metal, chemical, and oil refining industries. By the start of the fourth quarter, however, especially following the settlement of the second auto mobile strike, the economy experienced an accelerated rate of recovery and quickly moved to new records in virtually all sectors. The fourth-quarter advance was stimulated not only by the general recovery trend but INDUSTRIAL PRODUCTION U N IT E D S TATES (S e a so n a lly adjusted indexes, 1957-100 1 UTILITI NONDURABLES TOTAL D U R A B LE S .............................. ............• • # M IN IN G * p-Preliminary «-£stim oied SO U RCES: Board of Governors, Federol Reserve System Federal Reserve Bank of D o lla r B U S IN ESS 1:1962 REVIEW 3 CHANG ES IN SELEC TED ECO NOM IC IN D IC A TO RS United States Indicator 1961 e Industrial production index (1 95 7 = 100)1......................... . Expenditures for new plant and equipment'...................... Total new construction expenditures3. ............................... . Manufacturers' new durable goods orders3. . . . . . . . . . Unemployment rate (percent of civilian labor force]1. . . . Personal Income3............................................................ .. Retail sales3.................................................................................. . Consumer price index ( 1 9 4 7 - 4 9 = 1 0 0 ) ................................. 109.3 34.50 57.5 14.9 6.7 417.0 18.3 127.9 1960 108.0 35.68 55.6 14.3 5.6 402.2 18.3 126.5 Percent change 1 —3 3 4 19 3 0 1 1 Seasonally adjusted. '2 Seasonally adjusted, in billions of dollars. e — Estimated. S O UR CE S: Board of Governors of the Federal Reserve System. Federal Reserve Bank of Dallas. United States Department of Commerce. United States Department of Labor. also by recovery from strike- and storm-induced slow downs. The normal seasonal pressures of the fourth quarter of the year were reinforced by a sudden marked improvement in consumer buying, the begin nings of a slow recovery in private capital spending, and renewed emphasis upon government spending. The continuing monetary policy of ease and the ac celerating deficit in the Government’s budget added new funds for expansion. Thus, in the fourth quarter, strength in all sectors — business, government, and the consumer — provided the upward impetus for a major expansion in the gross product of the Nation. Only the effects of an enlarging deficit in the Nation’s balance of payments and the continuingly high level of unemployment remained to cloud the picture of the near-term outlook. Moreover, the rate of unemploy ment was reduced sharply in the closing months of the year. In reviewing this chronological summary of the changes in the Nation’s economy during 1961, it seems worthwhile to note that developments among the major sectors generally tracked normal cyclical patterns. The lag in the unemployment decline (aggravated by structural and other causes), the slow recovery in consumer spending, and the continued decline in plant and equipment expenditures after recovery had com menced are trends which the business cycle analyst has come to expect in a recovery period. Government policies dedicated to lower long-term rates and higher short-term rates were partly responsible for this stability. Although this trend is counter to that shown in other major recovery periods, it should be noted that interest rates had not declined in the short term sector nearly as far as in previous recession periods. Thus, recovery was able to develop within the existing framework of interest rates. At the close of the year, the Nation’s economy had reached a new peak. Industrial production, construction, and personal incomes had been rising rapidly, while unemployment, though high, had been declining. The recession had been largely forgotten except in its legacies of higher unemployment rates and the deficit budget position. The economic pattern described for the Nation as a whole was largely reproduced in the economic de velopments of the Southwest with the exception of the magnitude of the changes. Although no broad measure of Eleventh District activity is available, it seems ap parent from the inferences obtained by studying indi vidual indicators that the Southwest’s economy failed to decline as much as the Nation’s during the recession and rose at a somewhat slower rate during recovery. Industrial production in Texas advanced 2 percent during 1961, with increases registered in all the major sectors. The most significant gains occurred in elec trical machinery and primary metals, but there were offsetting declines in lumber and wood products and metal, stone, and earth mining. The Texas industrial production index reached a new record in October at a level of 180 percent of the 1947-49 average, or 6 percent above the previous year’s index and signifiTEX A S IN D USTRIA L PRODUCTION ( S a e ic ro ilj adjusted Indeies, 1947- 49 ■IOO 1 PERCENT PERCENT 300 300 DURABLES ^ B US I N ESS 4 REVIEW 1:1962 _ ----------------- - • p 250 \ N O N D U R AB LE S Various other developments were not anticipated, however, and thus surprised many businessmen and consumers. Among these were the two major reviews of national defense expenditure policies, one in March and the other in July, both of which occasioned a marked flurry of activity and expectations of possible inflationary pressures. Another unexpected develop ment was the stability of interest rates over the recovery period. System monetary policies of active ease and ___ 250 __ 200 \ - . ----------------- 200 y TOTAL 150 150 l ............... X M IN IN G IO O p- Prelim inary • -E c tim o ttd I9 6 0 1 9 61 p e 100 cantly higher than the hurricane-affected low of 167 in September. As in the Nation, the strongest im provement in the major production sectors was shown by durable goods, though nondurables also advanced, especially in the chemical industry. The mining sector was almost unchanged, however, as small increases in petroleum and natural gas output offset declines in metal, stone, and earth mining. The District’s indus trial output was increased by new industrial plants, but this stimulus was not as strong or as broadly based as in other recent years. Among specific industries which are of special significance to the Southwest and which may modify the impact of national economic trends on this area, the most important is the petroleum industry. For 1961, the District petroleum industry showed no marked changes. Crude oil production advanced a little more than 1 percent over the 1960 total, mainly on the basis of new wells and some secondary recovery activity. However, the number of allowable production days in Texas declined from 103 in 1960 to 101 in 1961. The impact of competition, both domestic and foreign, kept the industry at a low level of operation and further depressed drilling activity. For the year as a whole, well completions showed a 4-percent de cline, and the footage drilled was down more than 1 percent. Of the individual states in the Southwest, Louisiana and New Mexico had the greatest gains in drilling activity, and Texas, the largest decrease. Texas well completions declined about 5 percent from a year ago, while northern Louisiana completions advanced 17 percent. Gas wells continued to draw most of the attention of drillers, and gas well completions in the District showed a marked 18-percent advance; on the other hand, oil well completions were down 7 percent. With no major changes in refinery capacity, refinery activity, as measured by crude runs to stills, showed a total gain of 1 percent for the year. Petroleum refining was interrupted by weather conditions asso ciated with Hurricane Carla during September and, to a lesser extent, by a major strike in the final quarter of the year. Although both production and refining showed no significant changes, the industry’s petro chemical sector reflected moderate expansion. The demand for major petroleum products in the United States rose only fractionally in 1961, with the largest increase accounted for by kerosene as a result of the product’s use as a jet fuel. Stocks were little changed and the industry appeared to be in reasonable balance, but this balance was achieved only by severe restric tions upon southwestern production. Price levels were generally weaker for both crude oil and refined prod ucts, with gasoline price wars continuing most of the year. Construction activity in the District states showed considerable improvement over the preceding year. With a cumulative gain of 7 percent, total contracts exceeded $4 billion in 1961 for a new record surpassing the previous record in 1959. Within this construction total, residential contracts rose almost 9 percent, with heavy emphasis upon apartment-type Iconstruction. Al though residential construction was blow in the early part of the year and project-type construction lagged relative to previous years, there was an irregular increase in residential building as overhangs in local markets were dissipated by the rather steady demand. Increases in not only construction costs but also basic land values probably accounted for some of the rise in the dollar volume of residential contracts. Contracts for nonresidential building in the District states improved about 9 percent, and public works and utilities contracts increased nearly 3 percent in 1961. Factory construction was weaker in the District than in other recent years, although commercial construction continued relatively strong. The increase in public works and utilities probably stemmed from the late im provement in plant and equipment expenditures by utilities, which offset some declines in specific public works sectors, including streets and highways. Among VALUE OF CONSTRUCTION CONTRACTS F IV E SO U T H W E ST ER N STATES e-Ftortiolly estimated S O U R C E S : F W Dodge Corporation Federal Reserve Bonk o1 D ellas B U S I N E SS 1:1962 REVIEW 5 the five District states, Texas, Oklahoma, and Arizona recorded the highest cumulative contract totals since 1956, whereas Louisiana and New Mexico showed relatively weak construction patterns. One interesting divergence has been the decline in the number of em ployees in the construction industry at a time when contracts have risen. This apparent contradiction may be a result of the more efficient use of labor-saving machinery but might also be a result of the type of construction which was emphasized during 1961. To some extent, the unemployment picture in this region tracked the Nation’s pattern, with high levels of unemployment early in the year. However, steady reductions at a faster rate, especially in the latter part of the year, were a feature of the southwestern picture. At the end of 1961, the unemployment rate in Texas was well below the rate in the Nation, and only one “major” labor market in the District was classified as having a substantial labor surplus. Personal income in the District states rose nearly 4 percent over 1960. Increases in employment and a longer factory workweek were partly responsible. In addition, the gain in farm income and the high level of unemployment compensation payments helped to increase total income. The pattern of retail trade in the District was similar in broad aggregates to that in the Nation, with a small gain of approximately 2 percent over the previous year. However, among the various types of outlets, the pattern of change in the District diverged substantially from that in the Nation. For example, although general merchandise sales in the District were apparently much lower than in 1960, such sales showed a moderate gain in the Nation. Similarly, sales at automotive establishments were markedly higher in the Nation but lower in the District. The effect of the recession upon employment in the District states was felt primarily in the construction and manufacturing sectors, although a large decline occurred in the transportation and public utilities category and a moderate decline occurred in mining employment. These two declines were associated more with structural changes and long-term problems than with the recession. Nonagricultural employment in the District states averaged about 4,480,000, or frac tionally above the 1960 annual average. Increases in finance, government, services, and trade followed the pattern of previous years and emphasized the shifting nature of employment opportunities in the Southwest. Changes in factory employment brought the total to a higher level at the end of 1961 than at the end of 1960, though the composition of such manufacturing em ployment shifted considerably. Declines were apparent in the employment of workers in major aircraft as sembly plants and in lumber and wood products, chemical, and petroleum refining industries; while increases were especially noticeable in ordnance, ma chinery, and primary metals plants. BUSINESS 6 R EVIEW 1:1962 Part of the trend evident in retail sales in the Dis trict was a result of price changes for the principal products. For example, the decline in sales at gasoline service stations probably reflected the lower gasoline prices which prevailed during most of 1961. On the other hand, the District food outlets showed a modest sales gain over the preceding year, partly because of the wider range of merchandise offered and some price increases. The major declines from 1960 totals were registered in sales at general merchandise, apparel, and furniture and appliance stores, whereas increases were evident mainly at food, eating and drinking, and “other” retail establishments. It would be a mistake to lay too much emphasis on the percentage changes shown above since they represent primarily sales of a limited sample of stores. For example, the decline in general merchandise sales reported above runs counter to the change in department store sales. Eleventh District department store sales showed a small increase over the 1960 figure. The new state sales tax in Texas may have affected reports of all retail sales and was particularly instru mental in building sales volumes during August, just program for grain sorghums resulted in an acreage diversion of 35 percent for the District states, but total output declined only 12 percent. Per acre yields of major crops in 1961 were about the same as or higher than in 1960 except for peanuts and rice. The rice crop would have been much larger, as would the citrus crop, if Hurricane Carla had not damaged both crops substantially. prior to the effective date of the tax. Another high light of retail trade activity in 1961 was the continued opening of major new stores in the larger urban areas. These stores have ranged from suburban exten sions of downtown department stores to a significant number of new discount houses. The discount houses have been an especially important force in competitive retail selling throughout the District, particularly with respect to sales of appliances and other consumer durables, and the range of commodities offered has broadened substantially. Intensive efforts have been made to attract customers back to the larger depart ment stores in a number of Central Business Districts, but, at the same time, these stores have been opening new suburban branches to capitalize upon the com petitive advantage of convenience in the outlying areas. Agricultural activities in the District were among the strongest elements in the regional economy during 1961. Cash receipts from farm marketings increased around 5 percent, with receipts from crops up 6 per cent and those from livestock and livestock products up 3 percent. This improvement in cash receipts stemmed from a small gain in the total output of crops and livestock and a moderate increase in prices. Prices received by Texas farmers and ranchers for all farm products averaged 4 percent above the 1960 level, with crop prices up 6 percent and livestock prices up 2 percent. Among the major crops of the District, cotton, corn, and peanuts showed the principal production increases; winter wheat was unchanged; and grain sorghums and rice reflected output declines. The basic Government In the livestock area, output of cattle, eggs, and wool showed only modest increases, but the output of turkeys and broilers was sharply above the previous year. The marked advance in turkeys and broilers brought a sharp decline in prices for these products, whereas prices for cattle and wool were stronger than in 1960. One of the stronger elements in the agricultural picture during 1961 was the excellent moisture situa tion and the nearly perfect timing of precipitation, which led to the large winter wheat and cotton crops. In all, the agricultural picture for the District was one of considerable strength, marred only by the impact of the storms on the Texas Gulf Coast area and by some increase in insect infestations in a limited number of sections of the District. It is ex pected that southwestern farm income, including Government payments, may be as much as 6 percent above the 1960 level. Financial Developments Activity in the financial markets reflected the change in economic conditions, as well as some long term trends persisting from the year before, but shortrun developments influenced the general atmosphere to a considerable degree. The total demand for credit in the economy probably advanced over the slow pace of 1960, with a marked change in the internal com position of such demand. In the area of capital markets, total new corporate issues reached a record of more than $11.6 billion, or almost $1.9 billion above the level in 1960. State and local security offerings also reached a new record of nearly $8.4 billion, which is about $1.1 billion over the previous year. Strength in the capital markets was particularly apparent in the second quarter of the year, when new corporate issues totaled $4.7 billion, or more than double the level in the comparable 1960 period. Part of the increase in demand for new capital issues came from corporations seeking to take advantage of the lower levels of interest rates, especially with the anticipation that such rates might be sharply advanced BUSINESS 1:1962 REVIEW 7 in the economic recovery. Moreover, corporations were seeking to increase internal funds available for both working capital and plant and equipment expen ditures. These demands were augmented by a desire to refund some outstanding securities which had been placed at substantially higher rates of interest during previous years. At least a portion of the proceeds from the new corporate issues was used to repay bank loans, although a substantial portion was used to finance the growing level of sales and operations, including the improved capital expenditures. State and municipal borrowings were enlarged, partly because of the interest rate attraction noted above; but, in addition, state and local government units were forced to increase borrowings to meet their larger expenditures for educational and institutional construction and other improvements. Total corporate and state and local issues during 1961 amounted to nearly $20 billion. In addition to the capital market expansion, credit demands were enlarged by a slowly rising need for mortgage credit as housing starts advanced from re cession levels. Mortgage rates on conventional con tracts firmed at about 6 percent, or nearly one-fourth of 1 percent below the level of 1960. Rising demands for mortgage credit were evident in business borrow ings to construct new apartment units, but, before the end of the year, demands were being generated by improved private single-dwelling housing starts. Gov ernment-underwritten starts were sharply lower than in 1960. One of the strongest areas of credit demand during 1961 was that of the Federal Government. With the Government’s budget moving into a deficit position and with this deficit increasing throughout 1961, Treasury operations required a steadily rising level of new cash borrowings; and, for the year as a whole, these new financings amounted to $15,094 million. Treasury financings were responsible for much of the uncertainty in the Government securities market as the Treasury came into the market every month except December. Treasury operations during the year included such new financing arrangements as the sale of “strips” of Treasury bills, one block of which was offered in June and the other in November. Treasury refundings and advance refundings were developed in such a way as to improve the average maturity of the market able debt, and no change in the maturity was evident. Bank purchases of some new short-term issues were BUSINESS 8 REVIEW 1:1962 LOANS AND INVESTMENTS ALL COMMERCIAL BANKS IN THE UNITED STATES B 1L L IO N S O F D O L L A R S ( A* of lo ti W e d n e sd a y of month ) B I L L IO N S OF D O L L A R S .__ . ^ ' P 120 MO MO L lo ans adju sted 100 90 -T O T A L INVESTM ENTS 80 80 I9 6 0 1961 70 p-Prelimmory e-Estimated SO U R C E S: Board of Governors, Federal Roservt System Federol Reserve Bonk of Dallos. assured by permitting credit to Tax and Loan Accounts. Bank loan demands during 1961 were relatively slack compared to the rate of recovery in the Nation’s economy. Total loans of all commercial banks in the United States reflected a year-to-year increase of more than $6 billion at the end of November, with the most rapid advance occurring in real-estate loans. Business and consumer loans were relatively un changed until very late in the year. Loans to nonbank financial institutions showed a slight gain, but con sumer credit requirements declined. On the other hand, total investments of all com mercial banks in the Nation advanced rapidly in 1961, with gains of more than 10 percent in holdings of both Government and non-Government securities. The year-to-year increase in investments through November amounted to about $9 billion, but some liquidation was evident late in the year. One feature of the in crease in investments was the move to shorter matur ities on the part of the banking industry. Faced with the possibilities of an expansion in loan demands and a substantial need for liquidity, banks increased their holdings of securities maturing within 1 year while reducing their holdings of long-term securities. Total bank credit rose nearly $15 billion over 1960, with slightly more than one-third of the advance oc curring in bank loans. The lack of strength in bank loans was puzzling to many observers, especially in view of the strong economic recovery. However, major causes of the slack bank loan demand probably were repayments of bank credit by business through capitalissue proceeds; the slow recovery in capital expendi tures; and the improving profit picture, which generated more internal funds to finance inventory accumulation. Consumer credit needs were also relatively weak, especially during the first 9 months of the year. Total consumer credit at the end of October amounted to $55,051 million, or only $707 million above the total at the end of October 1960. This weakness was particularly apparent in the instalment credit sector and, within that sector, in the demand for newautomobile loans. At the end of October, total auto mobile paper outstanding amounted to only $17,186 million, as compared with $17,992 million a year earlier. However, in the final quarter of 1961, with consumer durable goods purchases rising strongly, there were renewed demands for consumer credit. age free reserve figures for the banking system reveal a net borrowed reserve level for even the central re serve city banks in only a few months. System opera tions were aimed at providing reserves freely, and the money supply advanced during the first half of 1961. Moreover, rapid expansion in the last 6 months brought a full-year gain of nearly 3 percent. System monetary policies were formulated, first, to provide a proper financial environment for the domes tic economic pattern and, secondly, to contribute to stability and an improvement in the Nation’s inter national financial relationships. To accommodate the first objective of providing reserves to stimulate and then support the credit needs of an expanding econ omy, the System made substantial purchases of Government securities during 1961. Net sales from the System Open Market Account occurred only dur ing January, a normally heavy month of absorption, and in December. In all other months, the System’s Supplies of loanable funds advanced steadily dur operations provided reserves through open market ing 1961, partly because increased personal savings operations; for the year as a whole, the System Ac enlarged the level of time and savings deposits in the count increased about $2 billion. banking system and receipts at other financial insti tutions. Time deposits rose about $10 billion during Largely to accommodate the second objective, the the first 11 months of 1961, or at a seasonally ad System changed its method of implementation by ex justed annual rate of 12 percent. Savings and loan panding open market purchases to the full range of shares at all operating savings and loan associations maturities on February 20, 1961. This move was an advanced more than 13 percent, and savings at mutual extension of the action taken in late 1960 which savings banks rose approximately 5 percent. Gross allowed the Manager of the Open Market Account to demand deposits expanded about $5 billion in 1961, purchase securities with maturities of up to 15 months. with a sharp rise in individual, partnership, and cor As a result of this change in implementation, the poration accounts. Partly because of these deposit System’s open market portfolio shifted during the year, increases but also because of loan repayments, with longer-dated securities accounting for a greater especially in the consumer credit sector, bank loan- proportion of total holdings than in 1960. As an deposit ratios generally declined during 1961, though nounced at the time the change was made, the System remaining above the levels prevailing prior to extension of operations into full-range maturities mid-1959. involved a desire to maintain interest rates on short term funds at levels which would be more competitive Bank reserve positions were markedly improved with similar rates in foreign countries and, at the during 1961, primarily because Federal Reserve Sys same time, to encourage the flow of long-term funds tem policy actions continued to provide reserves to into productive investments. This operation was con support the expansion in bank credit. This monetary ducted in concert with efforts to encourage domestic policy of active ease had been carried over from the economic recovery and to deal with balance-ofprevious year in an attempt to modify the recessionary payments problems. forces and stimulate economic recovery. Free reserves of the member banks were maintained at a level in Other than with respect to open market operations, excess of $500 million during most of 1961, and mem System policy moves were relatively few during 1961. ber bank borrowings were correspondingly reduced to There were no changes in discount rates, which were relatively nominal levels. Borrowings exceeded an held at a 3-percent level, and no change in reserve average of $100 million per month in only 3 months requirements. Late in 1961, the System did make a of the year. It is interesting to note that the aver change in regulation Q to allow an increase in interest B U S I N ESS 1:1962 REVIEW 9 rates which commercial banks would be permitted to pay on time and savings deposits. The international financial developments which caused the System to modify its open market proce dures are well known in their impact upon the total balance of payments and the total gold holdings of the United States. Actions taken by the Federal Gov ernment to attempt to reduce the balance-of-payments deficit of the United States included additional requests to our allies to finance military expenditures either by direct payment or by tying such military aid to purchases of goods and services within the United States; lowering from $500 to $100 the limit on the total of duty-free goods which individual tourists might bring back from abroad; and steps to increase mer chandise exports, such as new commercial and political risk insurance. Other actions encompassed increased cooperation between central banks of the free world, purchases and sales of foreign currencies to reduce the impact of speculative developments, substitution of local currencies for dollars to cover local expendi tures in foreign nations, some increased tax relief to foreign central banks to encourage them to invest and keep their reserves in United States securities, the afore-mentioned aid in keeping short-term rates at competitive levels, and — very recently — an action to increase interest rates which could be paid on for eign deposits in commercial banks so that returns on such deposits could be more competitive with like rates in other nations. There was some improvement in the Nation’s balance-of-payments situation during 1961, especially in the early part of the year. The merchandise trade balance widened to a sharply higher level in the first quarter, and, correspondingly, the balance-of-payments deficit was reduced to a level of only $1.4 billion. However, excluding the effects of special debt repay ments (particularly by Germany), the basic deficit in the balance of payments rose to $1.9 billion in the second quarter and then above $3.0 billion in the third and fourth quarters of the year. For the full year, the deficit of around $2.5 billion in the United States balance of payments was reflected in a loss of about $900 million in gold and an increase of nearly $1.6 billion in foreign short-term dollar claims against the United States. The largest loss of gold occurred in the final quarter of 1961, with at least part of this loss occasioned by a return flow of currencies following the British stabilization program and the British draw ings against the International Monetary Fund. InternaBUSINESS 10 REVIEW 1:1962 tional markets were highly sensitive during most of 1961, being upset by exchange speculation following German and Dutch revaluations and by political un certainties, including various crises in the Congo, Berlin, and southeast Asia. The impact of these domestic and international forces upon interest rates in the money and credit markets of the United States was surprisingly small. However, it should be remembered that, in previous recessions, short-term interest rates had been permitted to fall to less than 1 percent and Federal Reserve System monetary policy actions included substantial reductions in discount rates. During the 1960-61 reces sion, such interest rates were generally held above 2 percent; as a consequence, the recovery was able to proceed without marked inflationary or destabilizing pressures within an interest rate structure which held relatively steady throughout the year. Average yields on 91-day Treasury bills remained within a 20-basis point spread from January through October; then, because of seasonal pressures, heavy short-term Treasury financings, and international con siderations, the rate advanced to more than 2.5 percent. On the other hand, yields on long-term Gov ernment securities fluctuated generally within only a 15-basis point change, with the higher levels again occurring in the later months of the year. The stability in interest rates, while especially important to the volume of bank credit demanded by corporations and municipalities, was a major factor in the improved competitive relationship of the United States since rates in most of the western European nations were generally declining (except in England, where drastic measures wer.e taken in mid-July to curb a rising deficit in its balance of payments). Toward the end of the year, as was the case at various times after the recovery began, market atmos phere was affected by reports on the improving busi ness situation, rumors of change in Federal Reserve monetary policies, and expectations of a rising level of interest rates. Such expectations and anticipations formed a body of shifting influences which, together with the virtually continuous Treasury financing oper ations, were destabilizing forces in the Government securities market. Major changes in dealer holdings of Government securities — notably the marked in crease in October and early November, when total dealer holdings exceeded $4.5 billion — also created fluctuating pressures on rates and prices of such securities. The composite of these forces influenced banking conditions in the District, as well as in the Nation; but, in addition, there were special circumstances in the region, as has been noted in the fore going economic review. Loan demands were generally stronger at member banks in the Eleventh District than at commercial banks in the Nation; and, for the year as a whole, the total gain in loans in the District reached more than 10 percent, contrasted with a 5percent advance in the Nation. Total investments of the District’s member banks showed slightly less strength than investments of the Nation’s commercial banks, with a gain of about 10 percent contrasting with a nationwide increase of more than 12 percent. Deposits at District member banks showed similar patterns to those in the Nation; gross demand deposits advanced about 5 percent, and time deposits rose more than 15 percent. Reserve positions of member banks in the District improved considerably, and borrowings were reduced to nominal levels during most of 1961. Member banks in the major cities generally adjusted their reserve positions for unusual periods of strain by resort to the Federal funds market, and the volume of Federal funds activity remained quite high during the year. District banks were heavy purchasers of Government securities, especially in the shorter-term area, and were major participants in new Treasury financings. In a number of short-term financings during the year, the Eleventh District ranked third or fourth among all districts in bank subscriptions for the new securities. Generally speaking, the banking atmosphere in the District was consistently more optimistic, partly be cause loan demands did not decline as much as in the Nation (in fact, loan-deposit ratios were higher toward the end of 1961 than a year earlier) and partly because the favorable agricultural situation in the District en abled farmers to repay loans carried over from previous years of crop failures. The advance in time deposits and the competition for deposits intensified during the year; with the change in regulation Q, many of the major banks in the Eleventh District have taken another step to increase the attractiveness of savings and time deposits in their banks by raising the interest rates payable on such deposits. Though to a lesser degree than in 1960, a major feature of the District banking picture was the continued increase in the number of banking institutions, with new banks being opened in many areas of the District. Summary Economic conditions in the Nation and the District at the end of 1961 could lead to further advances in the new year. The basic strength of a rising level of BUSINESS 1:1962 REVIEW 11 plant and equipment expenditures, higher totals of consumer purchasing, the improved consumer poten tial evident in the gains in incomes and employment, and rising construction activity — coupled with the continuing gains in new orders to manufacturers, pros pects for a higher level of inventory accumulation to hedge against a potential steel strike, and similar matters — are factors that could lead to an advanced level of economic activity in the first half of 1962. Among the major forces influencing the early-1962 financial situation in the Nation and the District are the possibilities of increased bank loan demands, the probability of additional Treasury financings, and un certainties in the international balance of payments. N E W PAR BANKS The Clayton State Bank, Clayton, Oklahoma, an in sured nonmember bank located in the territory served by the Head Office of the Federal Reserve Bank o f Dallas, was added to the Par List on December 8, 1961. The officers are: Mrs. Wharton Mathies, President (Inactive); Mrs. Carl McCoy, Vice President (Inactive); Wharton Mathies, Cashier; and Jeff Ingram, Assistant Cashier. The Zavala County Bank, Crystal City, Texas, an in sured nonmember bank located in the territory served by the San Antonio Branch of the Federal Reserve Bank of Dallas, was added to the Par List on December 15, 1961. The officers are: A. Owen W illiam s, President; R. S. Crawford, Sr., Vice President; B. R. Worden, Cash ier; and Iris R. Pegues, Assistant Cashier. BUSINESS 12 REVIEW 1:1962 B U S I N E S S REVI E W t B U S IN E S S , A G R IC U L T U R A L , A N D F IN A N C IA L C O N D IT IO N ! Department store sales in the Eleventh Federal Reserve Dis trict in November and Decem ber 1961 reached the highest dollar volume of record fo r the period. November sales rose 9 percent above No vember I9 6 0 ; and, despite one less pre-Christmas shopping day in December, final figures are expected to place Christmas trade this year at a record total. Cumulative department store sales fo r the first 11 months of 1961 were almost 2 percent above the comparable period in 1960. District crude oil production advanced in Novem ber and early December and should rise further in January as a result of increases in allowable sched ules in Louisiana and New Mexico. Drilling activity increased significantly in November, and refinery operations advanced in early December. The District's weekly reporting member banks in creased their loans and deposits but reduced their investments during the 5 weeks ended December 20. Consumer spending responded vigorously in November and De cember to give Eleventh District department stores their best November-December sales vol ume of record. Store traffic was the heaviest ever experi enced by District stores as a highly price-conscious public did its Christmas shopping. December trade was handicapped by one less shopping day before Christ mas than in 1960, but final figures are expected to show that a higher level of daily sales lifted December’s total to about the same as the record volume for that month established in 1960. Despite one less business day than in October, total department store sales in November in the District exceeded those in the previous month by 12 percent and rose approximately 9 percent above November 1960. The adjusted monthly index of department store Responding to a permissive change in regulation Q, a number of District banks have raised the interest rates payable on time and savings deposits. The Texas industrial production index declined to 178 in November but was above November 1960. Nonagricultural employment in the District states during the month decreased to 4 ,5 1 0 ,7 0 0 , and un employment in Texas increased to 4.9 percent of the labor force. The value of construction contracts in the District states rose moderately in October to $313 million, with increases in residential and nonresiden tial building offsetting a decline in public works and utilities construction. Unfavorable weather conditions delayed farming operations in the District during December. Outturns o f cotton and citrus fruits in 1961 were up moder ately from the year-earlier levels. Seedings fo r the 1962 winter wheat crop are one-tenth below acre ages planted fo r the previous year’s production. Sup plemental feeding of livestock has been accelerated to prevent weight loss. D E P A R TM E N T STO R E SA LES (Percentage change in retail valup) Area November 1961 from ---------------------------------------November October 1961 1960 Total Eleventh District................ 12 9 Corpus Christi.................................................. Dallas................................................................... El Paso................................................................. Fort W o r t h ......................................................... Houston............................................................... San Antonio....................................... Shreveport, La.................................................. Wac o................................................................... Other cities........................................................ 1 18 9 15 5 11 12 14 15 0 9 —2 0 16 13 17 —2 4 11 months, 1961 from 1960 2 •— 5 1 —5 2 5 4 7 0 0 sales, which makes allowances for differences in the number of trading days and for seasonal factors, rose from 174 percent of the 1947-49 average in October to 178 in November. The November index compares with 164 in the same month in 1960 and 179 in November 1959, the record high for the month. Cumulative sales BUSIN E SS 1:1962 REVIEW 13 IN D EX ES O F D E P A R TM E N T STO RE SA LES A N D STO CKS Eleventh Federal Reserve District (1947-49 == 100) SALE5 (Daily average) ST OC K S (End of month] Unadjusted Seasonally adjusted Unadjusted I9 60 : November........... 190 164r 211 192 1961! September.......... October............... November........... 168 177 206 175 174 178 199 211 216p 187 192 196p Date Seasonally adjusted r — Revised, p ■—- Preliminary. in the first 11 months of 1961 exceeded those in the same months in 1960 by almost 2 percent. Very low temperatures have halted growth of winter wheat in the northern Panhandle of Texas, and boggy fields have prevented full utilization of small grains for grazing. Wheat leaf rust has continued to appear in the northern Low Rolling Plains. The acreage seeded for the 1962 winter wheat crop in the District states is 10 percent below that for the 1961 crop, primarily reflect ing diversion under the 1962 wheat program, and is 20 percent below the 1951-60 average. Based on condi tions as of December 1, 1961, winter wheat production in 1962 is indicated to be one-fifth less than in the pre ceding year but 39 percent larger than average. Although field activities in south Texas commercial vegetable areas were slowed by unfavorable weather, New car registrations in four major Texas markets harvesting was possible in most areas. Plantings of in November advanced 6 percent over October and vegetables for winter harvest in Texas are estimated at were 5 percent more than in November 1960. The 81,000 acres, or 3 percent above the acreage harvested October-November gains in the number of registrations a year ago. Larger plantings of beets, broccoli, and ranged from 1 percent in Fort Worth to 8 percent in carrots were partially offset by reduced acreages of Dallas. Houston and San Antonio each showed an in cabbage, cauliflower, and lettuce. crease of 5 percent. As compared with a year ago, No vember 1961 registrations in San Antonio and Dallas Gathering of citrus fruits has been in full swing in rose 10 percent and 12 percent, respectively; Houston the Lower Rio Grande Valley of Texas. The total dam was about unchanged, while Fort Worth showed a age to the crop, especially grapefruit, from Hurricane 2-percent loss. In the first 11 months of 1961, registra Carla has been greater than estimates made immedi tions declined 10 percent in Dallas and 11 percent in ately following the storm. The 1961 output of oranges Houston from the comparable 1960 period; in San and grapefruit in the District states is indicated at 14.4 Antonio and Fort Worth, there were decreases of 16 million boxes, or 3 percent above the 1960 total. An percent and 17 percent, respectively. increase in the orange crop is likely to offset a decrease Farming activities in the Dis in grapefruit production. trict were at a virtual standstill Freezing temperatures have extended into south throughout a large part of De central areas, killing late-summer range and pasture cember as a result of inclement coverage. Bitter cold weather on the Texas High Plains weather, including freezing tem and wet fields and pastures elsewhere in the District peratures, rain, snow, and ice. Most farmers are con necessitated feeding livestock at a heavier than usual siderably behind schedule in harvesting late crops and rate during December. Lambing and calving are in full preparing fields for 1962 seedings. Ranchers have swing throughout southern counties; some lamb losses stepped up supplemental feeding of livestock because have been reported in the Edwards Plateau as a result of unfavorable weather conditions. of the extremely cold weather. Cotton harvesting is substantially behind a year ago W IN T E R W H E A T in the Northern High Plains, parts of the Southern High Plains, and late areas of the Low Rolling Plains ACREAGE SEEDED PRODUCTION (In thousands of acres) (In thousands of bushels) of Texas. Cotton production in the District states, as of Crop of Crop of Crops of Crop of Crop of Crops of Area 1962 1961 1951 -60 196212 1961 1951-60 December 1, is placed at 6.7 million bales, or 45,000 29 28 51 1,044 1,118 1,567 bales below the month-earlier forecast but 4 percent Arizona................... Louisiana................ 52 58 *70 624 840 *750 Mexico......... 268 291 431 4,824 8,004 1,917 larger than output in 1960. As compared with a month New Oklahoma............. 4,398 4,887 5,368 96,756 110,832 75,225 4,067 4,510 61,540 84,870 38,874 ago, the December 1961 estimate reports output de Te x a s ....................... 3,620 Tota l ................... 8,367 9,331 10,430 164,788 205,664 1 18,333 creases for Louisiana and Oklahoma but a slight increase for Arizona; estimates for the other District 1 Indicated December 1, 1961. 2 Short-time average. states are unchanged. S O U R C E : United States Department af Agriculture. BUSINESS 14 REVIEW 1:1962 Loans, investments, and deposits all moved to higher levels at the Nation’s weekly reporting mem ber banks during the 5 weeks ended December 13. The money market was relatively firm during the first half of the period as banks in the money centers were under con siderable reserve pressure, stemming, in part, from the need to meet dealer financing requirements. The pres sure on reserves was reduced in late November and early December, and the money market eased notice ably. The effective rate on Federal funds, which ranged from 2 Vi percent to 3 percent early in the period, moved generally between 1% percent and 2 Vi percent in the latter part of the period. The market for Government securities displayed a generally heavy tone throughout the 5 weeks. Early in the period, the market was in the process of adjusting to the November 15 Treasury financing and the accom panying high level of dealer inventories. L ater — despite a reduction in dealer inventories — the heavy tone was maintained by signs of further business im provement, a sharp outflow of gold, and changes in Federal Reserve Board Regulation Q allowing higher maximum rates on time and savings deposits. The mar ket bid rate on 91-day Treasury bills closed at 2.39 percent on November 8, reached 2.63 percent on De cember 15, and stood at 2.60 percent on December 22. At the District’s weekly reporting member banks, loans and deposits expanded but investments declined in the 5 weeks ended December 20. Cash accounts and total assets advanced moderately. Gross loans (excluding interbank loans) rose $70.6 million, with moderate gains in consumer-type loans, loans to “other financial institutions,” and loans for purchasing or carrying securities. Commercial and in dustrial loans, on the other hand, moved slightly lower because of reductions in loans to firms producing du rable and nondurable goods and in loans to firms en gaged in trade and construction. M inor gains were shown by a few other types of business borrowers. In the corresponding period of 1960, gross loans ad vanced $83.8 million; over one-half the expansion oc curred in loans for purchasing or carrying securities. Total investments at the District’s weekly reporting member banks declined $14.9 million during the 5week period. Government security holdings decreased $8.6 million, as a reduction in holdings of Treasury C O N D ITIO N S T A TIS TIC S O F W E E K L Y REPO RTIN G M EM B ER B A N K S IN LEA D IN G C i t i e s Eleventh Federal Reserve District (In thousands of dollars) Dec. 20, 1961 Nov. 15, 1961 Dec. 21, 1960 *1,732,755 48,017 1734,8 62 40,941 1,565,245 32,940 17,274 62,464 5,274 59,690 40,145 23,396 3,838 *1 63,936 99,327 79 3,246 161,405 76,882 65 8,574 185,991 118,170 115 *91,155 *182,763 241,591 *759,256 83,840 172,408 237,656 733,108 108,205 132,142 215,040 751,573 Gross loans.................................................................... Less reserves and unallocated charge-offs.. 3,402,455 53,663 3,309,377 54,097 3,181,544 54,191 Item ASSE TS Commercial and industrial loans................................. Agricultural loans.............................................................. Loans to brokers and dealers for purchasing or carrying: U. S. Government securities..................................... Other securities............................................................. Other loans far purchasing or carrying: U. S. Government securities..................................... Other securities............................................................ Loans to domestic commercial banks.. . . . . . . . . . Loans to foreign banks. ................................. Loans to other financial institutions: Sales finance, personal finance, etc...................... Savings banks, mtge. cos,, ins. cas., etc.............. Real-estate loans.. .................... .................................... All other loans.................................................................... Net loans......................................................................... 3,348,792 3,255,280 3,127,353 Treasury bills...................................................................... Treasury certificates of indebtedness....................... Treasury notes and U. S. Government bonds, including guaranteed obligations, maturing: Within 1 y e a r ......................................... .. After 1 but within 5 years....................................... After 5 year*................................................................. Other securities................................. ............................... 136,816 58,116 122,642 56,060 91,379 32,236 195,324 786,883 356,0711 4 1 5,27)8 175,927 761,949 425,233 421,542 145,039 743,083 363,628 360,106 Total investments.......................................................... 1,948,48|8 1,963,353 1,743,471 Cash items in process of collection....................... .... Balances with banks in the United States............... Balances with banks in foreign countries................ Currency and coin.......... ....................................... .. Reserve* with Federal Reierve Bank........................ Other assets......................................... ............................. 6 1 4 , 5 110 559,482 2,057 61,641 589,365 218,441 610,641 491,166 1,659 57,921 626,864 204,244 559,917 550,707 2,470 56,558 580,972 T O T A L A S S E T S ........................................................ 7,342,7716 7,211,128 6,841,566 3,200,787 3,078,150| LIABILITIES AND CAPITAL AC C OU N TS Demand deposits Individuals, partnerships, and corporations.... Foreign governments and official institutions, central hanks, and international institutions.. United States Government................................ .. States and political subdivisions. . . . . . . . . . . . Banks in the United States, including mutual savings banks.. . . . . . . . . . . . . . . . . . . . . . . . Banks in foreign countries. . . . . . . . . . . . . . . . . Certified and officers' checks, etc......................... Total demand deposits......................................... Time and savings deposits Individuals, partnerships, and corporations Savings deposits. ............................ ..................... Other time deposits............................................... Foreign governments and official institutions, central banks, and international institutions,. U. S. Government, including postal savings. . . States and political subdivisions. . . . . . . . . . . . Bonks in the United States, including mutual savings banks. ..................................... .. Banks in foreign countries. ............. ........................ 220,118 3,012,792 3,357 114,612 215,506 4,307 152,732 200,460 115,434 203,126 1,228,463 14,927 61,229 1,212,696 13,697 71,327 1,168,698 14,771 51,822 4,838,881 4,733,369 4,566,643 805,700 544,971 795,025 555,346 3,005 7,317 307,810 1,005 7,077 299,596 4,487 5,7951 1,200 1,200 f 1,205,855 12,907 246,247 10,074 Total time and savings deposits....................... 1,674,490 1,665,044 1,475,083 Total deposits. .................. ............................... 6,513,371 6,398,413 6,041,726 Bills payable, rediscounts, etc...................................... All other liabilities...................... ............................... Capital accounts............................................................... 96,050 125,742 607,6)3 94,480 111,702 606,533 93,250 134,643 571,947 T O T A L LIABILITIES AND CAPITAL AC C OU NT S 7.342,776 7,211,128 6,841,566 1 Because of recent reclassifications, these data are not strictly comparable with year-earlier data. N O T E . — As a result of changes in call report instructions, additional information is available, effective April 26 , 1961, on the deposit struciure of member banks. Comparable year-earlier figures will be shown when they become available. notes and Government bonds maturing after 5 years more than offset increases in the other types and maBUSINESS REVIEW RESERV E P O S ITIO N S OF M EM B ER B A N K S Eleventh Federal Reserve District (Averages of daily figures. In thousands of dollars) Item 5 weeks ended Dec. 6, 1961 4 weeks ended Nov. 1, 1961 5 weeks ended Dec. 7, 1960 RESERVE CITY BANKS Total reserves held.......................... . With Federal Reserve Bank.. . . Currency and coin....................... . . Required reserves............. Excess reserves................................. . Borrowings.......................................... . Free reserves........................................ 595,684 554,751 40,933 588,477 7,207 829 6,378 601,250 560,415 40,835 594,757 6,493 214 6,279 576,095 554,015 22,080 565,342 10,753 0 10,753 C O UN TR Y BANKS Total reserves held.......................... . With Federal Reserve Bank... . Currency and coin....................... . Required reserves............................ . Excess reserves. ............................... . Borrowings............................................ . Free reserves..................................... .. 538,793 432,860 105,933 471,608 67,185 891 66,294 525,243 419,276 105,967 460,949 64,294 1,291 63,003 485,800 430,550 55,250 415,199 70,601 6,123 64,478 ALL MEMBER BANKS Total reserves held .......................... . With Federal Reserve Bank.. . , Currency and coin......................... . Required reserves............. .. Excess reserves............................ . . ,. Borrowings.............................................. Free reserves......................................... 1,134,477 987,611 146,866 1,060,085 74,392 1,720 72,672 1,126,493 979,691 146,802 1,055,706 70,787 1,505 69,282 1,061,895 984,565 77,330 900,541 81,354 6,123 75,231 N O T E . — Beginning November 24, 1960, all currency and coin held by member banks allowed as reserves; during the period December 1, 1959-November 2 3 , I 9 6 0 , only part of such holdings was allowed. turity categories of Government securities. Non-Gov ernment security holdings declined $6.3 million. In the comparable period a year earlier, total investments were virtually unchanged. Drilling activity in the Eleventh District advanced significantly in November. Total footage drilled during the 4 weeks ended De cember 2 was one-tenth higher than in the first 4 weeks of October, and total well completions were 17 percent greater. Continuing the trend that has been evident in the past few months, the number of rotary rigs active in the District increased 2 percent during November. District crude oil production rose slightly in Novem ber, and a more significant advance is expected for De cember. Daily average crude oil output in the District exceeded 3 million barrels in early December, or about 4 percent above a month ago. District crude oil pro duction should continue to rise in January. Louisiana and New Mexico have increased allowables for that month, while Texas has held the allowable schedule for January at the December rate of 9 producing days. Additional output is expected in Texas from new well completions. Refinery activity in the District during November, on the other hand, failed to maintain the rapid October pace which had been stimulated by recovery from hurricane-induced shutdowns. In addition, November refinery runs were affected by a strike at a large refinery. Despite the continuation of work stoppages, crude oil runs to District refinery stills in early December were fractionally above the like November period. Total demand deposits rose $105.5 million at the District’s weekly reporting member banks in the 5 weeks ended December 20, with the increase largely accounted for by an expansion in demand deposits of individuals, partnerships, and corporations. Time and savings deposits rose $9.4 million. Time deposits of Crude oil demand in the Nation, as reflected by crude individuals, partnerships, and corporations were vir oil runs to refinery stills, was virtually unchanged in tually unchanged, while time deposits of states and November but, on a seasonally adjusted basis, declined. political subdivisions moved higher. The largest rela New supplies of crude oil were limited during the tive gain occurred in time deposits of “foreign govern month; a moderate decline in imports offset a fractional ments and official institutions, central banks, and international institutions” and may have been a reac N A TIO N A L P E TR O LE U M A C T IV ITY IN D IC A TO RS tion to the changes in regulation Q which allow higher (Seasonally adjusted indexes, 1957-59 = 100) interest rates to be paid on time and savings deposits. November October November In late December, many of the District banks an 1961 p 1960 Indicator 1 961 p nounced changes in the rates to be paid on time and CRUDE OIL RU NS T O REFINERY 105 107 101 STILLS (daily average].................... savings deposits in accordance with the permission DEMAND (daily average) granted under the recent amendment to regulation Q. 109 106 110 Gasoline................................................. Total reserves of the District member banks rose somewhat in the 5 weeks ended December 6, with all the gain occurring at country banks. Borrowings moved slightly higher at both reserve city banks and country banks, but excess reserves expanded even more. Con sequently, free reserves increased moderately and re mained at comfortable levels. BUSINESS 16 REVIEW 1:1962 Kerosene ................................................ Distillate fuel oil.................................. Residual fuel oil................................... Four refined products.................. 118 105 93 105 132 102 95 104 115 100 98 106 S T O C K S (end of month) Gasoline................................................. Kerosene ................................................ Distillate fuel oil.................................. Residual fuel oil................................... Four refined products................... 103 no 104 79 101 106 109 101 82 101 104 112 116 82 102 p — Preliminary. S OU R C ES : American Petroleum Institute. United States Bureau of Mines. Federal Reserve Bank of Dallas. advance in crude oil output. Crude oil stocks at the end of November were moderately below the month-earlier level. During the first half of December, however, crude oil supplies rose slightly, but demand increased more; as a result, the downward trend in inventories continued. Refined product consumption rose more than season ally during November. Gasoline demand declined less than anticipated, and distillate fuel oil consumption ad vanced more than seasonally. On the other hand, there was a somewhat disappointing rise in kerosene and residual fuel oil demand. Seasonally adjusted inven tories of all refined products were little changed. The demand for the four major refined products continued to rise in early December, paced primarily by increases in light fuel oil consumption. Stocks of these products declined moderately, centered in reductions of light and heavy fuel oil inventories. Prices for kerosene and distillate fuel oil were firm in most principal markets of the country in mid-Decem ber, with cooler weather strengthening demand. Gaso line prices were unsettled in late November and early December as a result of the introduction of a third type of gasoline; and price fluctuations were noted at the retail and tank-wagon levels. A firming trend, however, developed in mid-December throughout most of the country. Wholesale prices for gasoline were tending higher in midwestern markets, following recent price advances at the dealer level. Heavy fuel oil prices rose, especially in interior markets. The Texas industrial production index declined to 178 in Novem ber, or 2 points below the all time high in October but 6 points above a year ago. There were month-to-month decreases in both manufacturing and mining, with the largest declines occurring in the output of petroleum and coal products and crude oil. Compared with a year earlier, moderate increases were registered in durable and nondurable goods, while mining showed only a fractional gain. Output of furniture and fixtures, primary metals, textiles, and leather and leather prod ucts advanced more than 10 percent over November 1960. Nonagricultural employment in the District states in November decreased slightly to 4,510,700 but re mained fractionally above the November total in 1960. Increases in trade and government employment, asso ciated with the approaching holiday season, failed to IN D U S TR IA L PR O D U C TIO N (Seasonally adjusted indexes, 1 947-49 _ 1 0 0 ] Area and type at index November 196 I p October 1961 September 1961 November 1960 TEXAS Total industrial production................. Total manufactures............................... Durable manufactures......................... Nondurable manufactures.................. Mining........................................................ 178 226 267 207 132 180 229 271 209 134 167r 207r 250 187 129r 172 215 251 198 131 UNITED STAT ES Total industrial production................. Total manufactures............................... Durable manufactures......................... Nondurable manufactures................. Mining....................................................... Utilities....................................................... 173 172 178 170 131 319 171 170 174 169 131 318 169 167 r 171 r 167r 128r 316r 159 157 1 59r 158 129r 287r p — Preliminary, r — Revised. SO UR C E S: Board of Governors of the Federal Reserve Sy slam. Federal Reserve Bank of Dallas. offset declines in the construction, manufacturing, and service sectors. Primarily as a result of seasonal factors, unemployment in Texas increased in November to 180,000, or 4.9 percent of the labor force — compared with 4.4 percent in October and 5.4 percent in November 1960. Construction contracts in the District states in creased moderately during October to total $313 mil lion, as gains in residential and nonresidential building offset a decline in public works and utilities construc tion. Cumulative contracts from January through Oc tober 1961, at $3,379 million, were 4 percent more than in the comparable period in 1960; significant ad vances in residential and nonresidential contracts out weighed a 4-percent decline in public works and utilities. Contracts for nonresidential building in the first 10 months of 1961 were at a record high, but those for public works and utilities were below levels reached in the corresponding period in all recent years except 1959. N O N A G R IC U LTU R A L E M P LO Y M E N T Five Southwestern States1 Percent change Nov. 1961 from Number of persons Type of employment November 1961 e October 1961 November 1960r Oct. 1961 Total nonagricultural wage and salary workers.. 4,51 0,700 4,518,500 4,488,400 — 0.2 0.5 778,800 779,500 781,200 — .1 — .3 3,731,900 239,400 209,100 3,739,000 239,400 299,400 3,707,200 241,300 297,500 — .2 .0 — 3.5 .7 — .8 — 2.8 387,700 1,107,200 222,100 606,600 879,800 387,100 1,102,100 222,700 610,700 877,600 404,600 1,104,500 215,400 589,300 854,600 .2 .5 — .3 — .7 .3 — 4.2 .2 3.1 2.9 2.9 Manufacturing......................... Nonmanufacturing .................. Construction......................... Transportation and Government......................... Nov. 1960 1 Arizona, Louisiana, New Mexico, Oklahoma, end Tex<Js. e —- Estimated, r -— Revised. S O U R C E S : State employment agencies. Federal Reserve Bank of Dallas. BUSINESS REVIEW 17 C O N D ITIO N B A N K D E B ITS , EN D -O F-M O N TH D EPO SITS A N D A N N U A L RA TE OF TU R N O V E R OF D EP O SITS (Dollar amounts in thousands) Debits to demand deposit accounts1 (In millions of dollars] Area Oct. 1961 Nov. 1960 Annual rote of turnover Nov. 30, 1961 Nov. 1961 Oct. 1961 Nov. 1960 331,183 23 47 149,882 27.5 23.5 21.1 LOUISIANA Monroe.............. ............... Sh re veport.. . ,............... 96,410 325,291 8 —2 14 — 2 52,458 175,997 21.8 22.3 20.9 23.2 19.3 21.8 N E W MEXICO Roswell.............. ............... 52,864 —2 17 39,477 16.3 17.8 17.0 110,021 237,717 229,154 176,693 209,238 18,749 3,107,190 377,045 804,973 90,293 2,871,002 26,673 270,600 63,756 1 —4 — 10 0 6 —7 —3 6 —2 0 1 —3 23 —4 —9 0 4 1 —2 4 4 6 11 9 11 17 9 6 9 5 14 3 11 5 6 13 9 11 6 8 70,764 117,055 1 60,975 105,623 1 12,363 20,372 1,249,869 179,551 387,705 65,433 1,352,593 22,454 1 26,858 46,331 49,903 395,773 17,341 62,083 71,316 99,431 18.6 24.1 17.5 20.3 21.7 11.0 29.8 25.1 24.7 16.7 25.4 14.3 26.3 16.6 13.2 19.6 16.8 17.8 18.4 14.6 18.7 24.7 20.0 21.0 20.9 12.2 31.4 24.5 25.4 17.5 25.2 15.0 23.0 17.8 14.6 19.8 16.6 17.8 19.3 13.7 19.0 23.0 17.4 19.0 20.9 9.7 29.6 25.1 22.9 17.4 23.2 14.5 26.5 16.6 13.0 18.2 15.5 17.3 17.3 14.0 $5,131,687 24.5 24.8 23.2 $ TEXAS Abilene............................. Amarillo............................ Austin................. ............... Beaumont.......................... Corpus Christi. .............. Corsicana......... ............... Dallas................................ El P a so .. . . . . . ............... Fort W o r t h . . . ,............... Galveston. . . . ,............... Houston........... ................. Laredo .............................. Lubbock............ ............... Port Arthur, . . ,............... San Angelo . . . San Antonio. . ................ Texarkana5. . ................ Ty ler.................... Wa c o ................. ............... Wichita Falls. . ............. 643,985 24,140 108,481 121,707 To ta l— 24 cities. . ............. $10,444,622 0 11 $ 1 Deposits of irdivid uals , partnerships, and corporations and of statesi and |political subdivisions. 2 These figures include only two banks in Texarkana, Texas. Total debits for all banks In Texarkana, Texas-Arkansas, iincluding one bank located in the Eighth District, amounted to $ 5 6 ,0 1 4 ,0 0 0 for the month of November 1961. C O N D ITIO N OF TH E Oct. 25, 1961 Nov. 30, 1960 AS SE TS Loans and discounts.................................................. United States Government obligations............. Other securities. ............................................. .. . . . Reserves with Federal Reserve B an k. . . . . . . . Cash in vault®................................................ .... . . . Balances with banks in the United States. . . . Balances with banks in foreign countries®.. . Cash items in process of collection..................... Other assetse .............................................................. 5,442 2,812 975 928 171 1,193 3 588 255 5,383 2,922 1,019 932 168 1,197 4 594 338 4,922 2,540 852 882 157 1,297 2 579 293 T O T A L A S S E T S e ................................................... 12,367 12,557 11,524 LIABILITIES AND CAPITAL ACC OUN TS Demand deposits of banks................................... Other demand dep osi ts .................................. Time deposits......................................... .. ................ 1,303 6,965 2,822 1,305 7,079 2,879 1,262 6,638 2,451 Total deposits........................................................ Borrowings®................................................................. Other liabilities®. ....................... Total capital accounts®........................................... 11,090 63 159 1,055 11,263 87 142 1,065 10,351 24 170 979 T O T A L LIABILITIES AND CAPITAL AC C O U N TS ® ..................................................... 12,367 12,557 11,524 Item P e rce n t ARIZON A Tucson................ ............... Nov. 29, 1961 Demand deposits1 change from November 1961 S T A TIS TIC S O F A LL M EM B ER B A N KS Eleventh Federal Reserve District FED ERA L RESERV E BA N K OF D A LLA S e — Estimated. V A LU E O F C O N STRUC TIO N C O N TRA C TS ( I n mill ions of dollars) January— October Area and type October 1 961 p September 1961 October 1960 FIVE S O U T H W E S T E R N S T A T E S ' ...................................... Residential building............... Nonresidential building. . . . Public works and utilities. . . 313 156 87 71 300 133 72 95 280 103 89 87 3,379 1,417 1,028 933 3,257 1,317 976 967 UNITED S T A T E S ........................... Residential building............... Nonresidential building. . . . Public works and utilities.. . 3,291 1,498 1,005 787 3,004 1,381 987 637 3,319 1,390 1,165 764 31,481 13,708 10,161 7,612 30,788 13,006 10,359 7,423 1961 p 1960 (In thousands of dollars] Item Total gold certificate reserves................................ Discounts far member banks................................... Other discounts and advances............................... U. S. Government securities..................................... Total earning assets.................................................... Member bank reserve d e p o s i t s . . . . .................... Federal Reserve notes in actual circulation.,.. . . . . . . . Dec. 20, 1961 Nov. 15, 1961 Dec. 21, 1960 655,209 200 0 1,176,136 1,176,336 966,225 874,233 742,688 0 116 1,151,475 1,151,591 1,012,607 856,394 730,621 1,000 348 1,085,097 1,086,445 966,794 839,966 D A ILY A V ERA G E PRO D U C TIO N Area November 1961 p October 1961 p November 1960 Octaher 1961 November 1960 ELEVENTH D IS T R IC T................... Te xa s........................................... Gulf Coast........................... We st T e x a s ......................... East Texas ( p r o p e r ] . . . . . Panhandle............................ Rest af St a t e ....................... Southeastern New Mexico. . Northern Louisiana................. 2,929.6 2,527.2 458.7 1,124.6 128.1 107.2 708.6 274.9 127.5 2,875.0 2,495.3 453.5 1,101.4 126.1 107.4 706.9 272.8 106.9 2,916.1 2,526.6 448.8 1,127.9 131.3 106.6 712.0 257.3 132.2 1.9 1.3 1.1 2.1 1.6 — .2 .2 .8 19.3 0.5 .0 2.2 — .3 — 2.4 .6 — .5 6.8 — 3.6 O U TS ID E ELEVENTH DISTRICT. 4,263.9 4,2 56.6 4,216.9 .2 1.1 UNITED S T A T E S ........................... 7,193.5 7,131.6 7,133.0 .9 .8 >8 REVIEW 1:1962 P E R M ITS VAL UAT ION (Dollar amounts in thousands] Percent change Area Percent change from BUSINESS B U ILD IN G O F CRUDE O IL (In thousands of barrels) p — Preliminary. S O U RC ES : American Petroleum Institute. United States Bureau of Mines. Federal Reserve Bank of Dallas. 1 Arizona, Louisiana, New Mexico, Oklahoma, and Texas, p — ■ Preliminary. N O T E . — Details may not add to totals because of rounding. SO URC E: F. W . Dodge Corporation. NUMB ER ------------------Nov. 11 mos. 1961 1961 Nov. 1961 1 1 mos. 1961 Nov. 1961 from ------------------Oct. Nov. 1960 1961 1 1 months, 1961 from 1960 ARIZONA Tucson................. 693 9,746 $ 4,236 $ 42,576 77 77 21 LOUISIANA Shreveport. . . . 402 11,649 1,058 30,010 — 15 25 33 TEXAS Abilene.............. Amarilla............. Austin.................. Beaumont.......... Corpus Christi.. Dallas................. El Paso............... Fort W o r t h . . . . Galveston......... Houston.............. Lubbock............. Port Arthur. . . . San Antonio. . . Wa co ................. Wichita Falls. . 101 222 345 303 326 1,873 460 520 245 1,088 216 247 1,117 230 214 1,323 3,102 3,780 3,332 3,688 24,851 6,351 6,835 1,828 19,367 2,557 2,660 13,109 2,926 2,912 814 2,661 6,455 5,625 1,449 12,191 3,479 2,036 374 15,455 2,571 428 4,538 821 078 15,263 37,801 54,680 22,347 23,403 185,942 59,941 46,574 6,364 236,266 39,002 7,265 50,028 13,438 20,931 — 62 56 59 —2 — 20 — 31 4 — 15 — 74 — 39 — 29 — 44 0 2 — 71 — 46 49 149 184 59 24 — 31 — 47 12 8 2 — 28 48 — 34 — 66 — 30 23 36 30 116 44 35 6 6 — 14 12 — 23 —5 — 15 — 21 Total — 17 cities. . 8,602 120,016 $65,069 — 21 17 9 $891,831
@FedFRASER